Lloyds loses £54m tax battle

Lloyds Banking Group has lost the latest battle in its fight to avoid a £54m
tax bill.

HBOS Treasury Services, which was taken over by Lloyds, was found by a tax
tribunal last month to have set up a scheme for the purpose of tax avoidance.
Lloyds said that it would appeal the decision.

Back in April that tribunal had allowed the bank to keep the proceeds of what
it termed “highly artificial” transactions, however the case was referred back
to the tribunal by both HMRC and Lloyds, reported theGuardian.

Judge Howard Nolan dismissed the argument that the scheme, set up in 2003,
was designed for commercial purposes. He said that the emails shown to him “all
confirm that this project was the acceptance by Treasury Services of a marketed
tax avoidance scheme”.

An HBOS spokesman said: “We believe we acted entirely properly over the
transaction in question. However, we cannot discuss this case further as we are
likely to appeal the decision and therefore legal proceedings are ongoing.”